NFP Exam 1 UPDATED Exam Questions
and CORRECT Answers
The city transferred cash to the fund used to accumulate resources to pay bond principal and
interest. - CORRECT ANSWER - GF, DSF
The city received its share of a state sales tax that is legally required to be used to finance library
operations. - CORRECT ANSWER - SRF
The city sent property tax bills to homeowners to help pay for day-to-day operating costs -
CORRECT ANSWER - GF
The city paid for five fire engines, using resources accumulated in a fund to pay for capital assets
- CORRECT ANSWER - CPF
The city received a grant from the city to build an addition to the city hall. - CORRECT
ANSWER - CPF
The city received the proceeds of general obligation bond to finance the construction of a new
police station. - CORRECT ANSWER - CPF
The mayor was paid his monthly salary. - CORRECT ANSWER - GF
Expenditures for the operations of the Police Department were recorded. - CORRECT
ANSWER - GF
Parks admissions fees, dedicated for use in day-to-day maintenance of the city park system, were
collected. - CORRECT ANSWER - SRF
,The city paid a contractor who had completed a report on the potential for improving police
deployment as a way to reduce the crime rate. - CORRECT ANSWER - GF
The city workers were paid their weekly salaries. - CORRECT ANSWER - GF
The city retired some of its outstanding bonds, using money accumulated for that purpose. -
CORRECT ANSWER - DSF
A federal grant was received to help pay for the cost of constructing the new city hall. -
CORRECT ANSWER - CPF
The city received a donation from a taxpayer with the stipulation it be invested and kept in
perpetuity, so that the income from the investments could be used to buy library books. -
CORRECT ANSWER - PF
The city received income from the investments made in the previous activity. - CORRECT
ANSWER - SRF
Bonds were issued by the fund used to account for providing water to the residents of a
municipality. - CORRECT ANSWER - EF
The fund that finances the city's basic day-to-day operating activities lent $50,000 to the fund
that will provide city agencies with supplies on a user charge basis. - CORRECT
ANSWER - GF, ISF
The city-operated utility that provides electricity to the residents of a municipality billed the city
for electricity provided to city agencies. - CORRECT ANSWER - EF, GF
The city charter requires all hotel taxes to be accounted for in a separate fund dedicated to
maintaining the downtown business district. Hotel tax collections for the period were $500,000. -
CORRECT ANSWER - SRF
, Salaries were paid to the city's police officers and firefighters. - CORRECT ANSWER -
GF
The state lottery, which operates like a business entity, sent a check for its net revenues (after
paying lottery prizes) to the state. The state will add these revenues to general state revenues as
part of the state's program for financing elementary and secondary education. - CORRECT
ANSWER - EF, GF
Interest and principal on the city's general obligation debt were paid, using resources
accumulated specifically for that purpose. - CORRECT ANSWER - DSF
The fund that finances the city's day-to-day operating activities transferred cash to the fund that
pays principal and interest on outstanding debt. - CORRECT ANSWER - GF, DSF
The city sold general obligation bonds to buy land as part of a city hall expansion program. -
CORRECT ANSWER - CPF
The city's central motor pool billed each city department for use of vehicles. - CORRECT
ANSWER - ISF, GF
The state established a highway beautification program, to be financed by dedicating a new
motor vehicle license fee to that purpose. - CORRECT ANSWER - SRF
A wealthy taxpayer donated securities to a village, stipulating that the donation be kept in
perpetuity and that the resulting investment income be used solely to help support the activities
of the village library. - CORRECT ANSWER - PF, SRF
The state-operated toll road collected tolls of $1 million. - CORRECT ANSWER - EF
and CORRECT Answers
The city transferred cash to the fund used to accumulate resources to pay bond principal and
interest. - CORRECT ANSWER - GF, DSF
The city received its share of a state sales tax that is legally required to be used to finance library
operations. - CORRECT ANSWER - SRF
The city sent property tax bills to homeowners to help pay for day-to-day operating costs -
CORRECT ANSWER - GF
The city paid for five fire engines, using resources accumulated in a fund to pay for capital assets
- CORRECT ANSWER - CPF
The city received a grant from the city to build an addition to the city hall. - CORRECT
ANSWER - CPF
The city received the proceeds of general obligation bond to finance the construction of a new
police station. - CORRECT ANSWER - CPF
The mayor was paid his monthly salary. - CORRECT ANSWER - GF
Expenditures for the operations of the Police Department were recorded. - CORRECT
ANSWER - GF
Parks admissions fees, dedicated for use in day-to-day maintenance of the city park system, were
collected. - CORRECT ANSWER - SRF
,The city paid a contractor who had completed a report on the potential for improving police
deployment as a way to reduce the crime rate. - CORRECT ANSWER - GF
The city workers were paid their weekly salaries. - CORRECT ANSWER - GF
The city retired some of its outstanding bonds, using money accumulated for that purpose. -
CORRECT ANSWER - DSF
A federal grant was received to help pay for the cost of constructing the new city hall. -
CORRECT ANSWER - CPF
The city received a donation from a taxpayer with the stipulation it be invested and kept in
perpetuity, so that the income from the investments could be used to buy library books. -
CORRECT ANSWER - PF
The city received income from the investments made in the previous activity. - CORRECT
ANSWER - SRF
Bonds were issued by the fund used to account for providing water to the residents of a
municipality. - CORRECT ANSWER - EF
The fund that finances the city's basic day-to-day operating activities lent $50,000 to the fund
that will provide city agencies with supplies on a user charge basis. - CORRECT
ANSWER - GF, ISF
The city-operated utility that provides electricity to the residents of a municipality billed the city
for electricity provided to city agencies. - CORRECT ANSWER - EF, GF
The city charter requires all hotel taxes to be accounted for in a separate fund dedicated to
maintaining the downtown business district. Hotel tax collections for the period were $500,000. -
CORRECT ANSWER - SRF
, Salaries were paid to the city's police officers and firefighters. - CORRECT ANSWER -
GF
The state lottery, which operates like a business entity, sent a check for its net revenues (after
paying lottery prizes) to the state. The state will add these revenues to general state revenues as
part of the state's program for financing elementary and secondary education. - CORRECT
ANSWER - EF, GF
Interest and principal on the city's general obligation debt were paid, using resources
accumulated specifically for that purpose. - CORRECT ANSWER - DSF
The fund that finances the city's day-to-day operating activities transferred cash to the fund that
pays principal and interest on outstanding debt. - CORRECT ANSWER - GF, DSF
The city sold general obligation bonds to buy land as part of a city hall expansion program. -
CORRECT ANSWER - CPF
The city's central motor pool billed each city department for use of vehicles. - CORRECT
ANSWER - ISF, GF
The state established a highway beautification program, to be financed by dedicating a new
motor vehicle license fee to that purpose. - CORRECT ANSWER - SRF
A wealthy taxpayer donated securities to a village, stipulating that the donation be kept in
perpetuity and that the resulting investment income be used solely to help support the activities
of the village library. - CORRECT ANSWER - PF, SRF
The state-operated toll road collected tolls of $1 million. - CORRECT ANSWER - EF
